Build A Business That Buys Back Time with Brad Stokes

Reece sits down with Brad Stokes of Highspire to talk about the shift from owner operator to strategic owner, and why top-line revenue alone does not mean a construction business is healthy.

They get into real estate development, market timing, KPIs, org charts, gross profit tracking, and the systems that give owners more time to think clearly instead of constantly reacting. This episode is about building a tighter business first, so bigger opportunities do not break what you already built.

https://www.highspire.com

Register for the webinar here: https://us06web.zoom.us/webinar/register/2517803406883/WN_i02wixcGTJSDljlo4uCRsQ#/registration

Show Notes:
00:00 Show Intro
01:40 Brad’s Wild Backstory
04:39 Learning Real Estate
08:58 What HighSpire Does
12:08 Finding The Right Market
16:47 Keep The Model Simple
21:10 Revenue Versus Health
27:14 Track The Right Work
32:25 Buying Back Time
38:57 The Owner’s Brain
43:51 Choose Better Tools
45:52 Strategic Owner Shift

Find Our Hosts:
Reece Barnes
Matt Calvano

Podcast  Produced By:
Motif Media

Transcript

0:00

You got to ask someone, do they want to be an owner operator or a strategic owner? What is the way we're going to get there? And then what do we have to track, and what matters most. Welcome to Builders Budgets and Beers. I'm Reese Barnes, and I started this podcast to have real conversations about money in the building industry, the wins, the mistakes, and everything in between. I believe builders deserve to feel confident about their finances, and that starts by hearing from others who've been through it too. This industry can be slow to change, but the right stories and the right tools can make profitability feel possible. Let's get into it, all right. Brad, mics are hot. We're rolling. How you doing, Reese? I'm doing good, thanks. Uh, thanks for joining us all the way from, uh, up across the border in Canada. That's right, the Great White North, although victorious, but as mild as it gets in Canada. Yeah, that's right. That's because we're below the parallel, right? Like, it's just, you know, we're still in the tropical zone of northern United States, right? Yeah, but isn't it's more like, like Seattle weather, isn't it? Yeah, Vancouver and Seattle, really well, really similar. And then we're across the Vancouver Island, so Victoria gets a bit more sun, but something may not as wet is Seattle, but rain, yeah, we're, we're a rainforest at the end of the day, it sounds cheerful, we're very cheerful up here most of the time, I mean, you know, I mean, that's that's that's the fable that Canadians tell ourselves, I, you know, I'd say like Americans are more extroverted, the friendly, so okay, when my 20s I was part of a group called the Kindness Crew, and we traveled around the world doing acts of kindness in bizarre, weird ways. Okay, this is a long time ago, pre-real estate, and so we film it. Back when, I mean, my, this, this can do more than a $20,000 camera that we had, but weighed 40 pounds, yeah, and we'd have a film crew tracking us, and we wrote a couple books, and we're Good and Morris America. So we go to New York, and it's way easier to hug a New York construction worker than it is someone in Toronto, for that is hilarious. Toronto, they'll be like having a briefcase, it's like a football and yeah, bubble, whereas, like, you go to New York, or most parts US, and they're like, you want to hug, forget about it, you know, you guys get off the grain, come down here, you know. So, I'd say New York is the friendliest place I'd ever been, so that's wild. I don't know how many hundreds of 1000s of people around the world, I was the hugger, so yeah, yeah, you were the chief hug op. I was the chief, I was the chief hug guy. And then I don't even know if you can sell the book anymore, it might be on Amazon, but it's like cool to be kind. And okay, we really, Tom Green meets Mother Teresa, that was us. So that's hilarious, extreme acts of kindness, and it, I know it. After we all got married and had kids and got away from it, it crops up in weird times, like we did do corporate keynote speaking, so like ESPN or Disney or Starbucks, or corporations will hire us to come in, like SAS software. Yeah, sure, you'd do a big keynote, Tony Robbins type speech on kindness in the workplace, right? We call it the kindness. I had no idea. Yeah, yeah. So it's like I remember, like it was in San Fran once, and the band we built this city, yeah, was the opener. And then we came in high fiving, like, you know, 510, 1000 people. Yeah, it was so funny. And then we give a little talk about kind of the self, kind of the cold. Who said was that something starship, something starship, starship was there, and so we did these weird little Good Morning America, like we'd have these weird little moments of fame back before social media, and it was hard. So, okay, so if I googled your name, would this come up? Would there be a picture of you like hugging people and stuff? Maybe you could like go, Brad, you go to Cool to Be Kind on Amazon, Cool to Be Kind Brad Stokes, and it might come up. I mean, there's other kind of screws now, though. I've been in Toronto or in Vancouver, and I'll walk around a street, and this has helped me twice, whereas a bunch of people with T-shirts on this, I kind of screw, and I'll just give everyone a hug, so there's Kind of screws all around the world now. That was no, we were the first, so well, that makes a lot of sense with you, and like real estate and developing right there. Know what it was, I was like, I was like 100k in debt in my late 20s, and I was, you know, I was raised by a single mom on minimum wage. I mean, I would be about as poor as you can get in Canada, and I just.. I wasn't raised on finance or anything like that. I had a background in literature and history, which basically meant. I studied rugby at UVic, and yeah, my mom passed away when I was quite young, so it's like I was, I was like, I got to figure out money, so I just started to say yes to jobs in anything to do with learning about finance, and I did my MBA, and yeah, worked at TD Waterhouse as investment advisor, got all that training, but most of my business mentors for the Kindness Crew stuff, right, were all real estate developers, and so they're like, "Get into real estate, and I had this little think tank of developer-like guys in their 70s and 80s who I would run deals by, and they would tell me why I was an idiot, and so, and so, you'd learn, and then I would.. I worked for.. I can't tell the names, because these NDAs, but I would.. I know I've worked for private equity groups. I've probably raised 100 million in private equity, so not the.. not no debt. I'm just talking about the equity, yep, or any loans, or anything, or build out, or limited partnerships. Yes. LP guy was that you're an LP guy. I was. Yeah, I was like, and then I realized that, you know, it's you can have a great deal, but then a bad general partner, or you have a great general partner with a bad deal, and you need both. So I wanted to try myself, and I did three deals with Steve and Dan Cox, so it was CGS Property Group, and then it was Cox Developments, and I would be- I'd be on the disclosure statements or part of the general partner, but I wouldn't be necessarily front and center unless things went wrong, and so I did two big developments in Victoria downtown, like Towers, you know, 18 stories, and then one smaller development, Carlsbad California, in which that I was the actual developer, and those all collectively took about 12 years, because you know, from buying the land, like, you know, Carlsbad was tighter or smaller, but so you, I went to that journey from the private equity world to actually being a developer and trying not to go bankrupt, and honestly learned, like, why we were successful was basically first in, first out, so you start to, you start to understand, well, why were we able to raise money at a time the sellable per square foot was 500 bucks, and tell our investors that in three to four years, condos will sell for 800 bucks a sellable. It was all based on predicting demographic and population growth correctly. So that's always trained by guys who just, just see the trends coming, and then you'd see other guys who wouldn't do that, and then worst case scenario, they would go bankrupt, best case scenario for them. They would be able to get out of a bad deal through hard work and sweat. So, that's for our clients. My hope is that I can help them, like, say, "Listen, let's focus on the basics: demographics, yeah, population growth, and where can we potentially see what a market will do as much as possible. There's always a margin of error. You can be first in, but also, when should you start to pull back? Because real estate is different to construction, which is half of what we do at HighSpires. Help our clients run their construction companies better. Yep, but unless you're going to jump from market to market, it's not just location, it's timing. Yeah, and then the accuracy capital, believe it or not, is the easy part. Yeah, yeah. So, okay, there's, there's a lot in there. It was really good. That's my background. That's, that's, that was perfect. That was perfect. Okay, so we went from, we went from kindness, celebrity, yeah, into like inheriting this insane network of just like good luck and happenstance, call it of people that were investing and doing developing, and then you were a developer, and now you're at Hi Spire. Now, for the folks that don't know what High Spire is, give them a little bit on what Hi Spire is, and what your role is, what your focus is, and then there's a couple pieces I want to unpack, but we'll start there. Yeah, so, so High Spire is a coaching company. At the end of the day, first and foremost, there's two arms to it. There's, there's, we, we have clients who, who hire us to help transform their construction company, ideally to something that is more fully optimized, vertically integrated, self-sustaining operation. So, basically, it runs more efficiently and creates more time for the owner. Okay, now that owner may decide that he just wants to work more and create more and more and more, that's great. We hopefully, but we also want him to have more time for health and happiness and his kids, but also to develop real estate, because we feel that they're perfectly positioned construction company openers to create, you know, relative to the mean, relative to the average human, they are very optimal for developing real estate if they do it right, because they understand construction, they, they're constantly trained in negotiating and solving problems every day, they, they understand a. Permitting and entitlement risk, because they have to deal with that, so if you can, they understand finance better than a lot of people who come from different backgrounds, and then market risk, you know, it's kind of the trickiest thing, because markets can have really long cycles relative to even the five year cycle, there can be sure bigger one, so, so that's that's what we want to do. We want people to build wealth through real estate, whether that's just running your construction company better, but also ideally over time buying and holding real estate assets or developing them. Yeah, okay. Those are our clients. So, so, and who, and who do you like? What's the low end? What's the high end of who you work with? Top. Oh man, I think it's a real range. I think you will get clients in some of our groups who are, you know, they are doing one to 2 million of revenue a year. They're really early, really small. They're early. Yep. Then you'll have huge companies like doing over 50 million. I don't know if that's huge, but that, that would be the bigger than that, but it is a range we try to pair our clients in groups, learning pods, where they, they're a similar level, we like to pair them in different markets, so totally competition, and but it's it's a really good network, and what attracted me to it, I was actually, I just finished my development above my last big development, like 206 condos during Covid, and I got hired on as provincial government for a period of time to help solve some of the industrial real estate problems for BC Transit, so they're cool systems, so and it was cool because I got to play an industrial, which I'd never developed personally as a developer on, yeah, but definitely hard to transition the public sector if you're, if you've been an entrepreneur your whole life. So it was great, but I was going to make a transition, and then someone introduced me to Paul, and Paul was good friends with one of my ex business partners for the Kindness Crew, Valerie. Okay, you know, so I was like, okay, so not a scam, because it looked so, so good that I was like, can this be real? And sure, I looked at the founders, and I knew of Dave Campbell very well regarded in Victoria personally, but then Jordan also, incredible reputation, Jordan Milne, and Jordan was actually my tenant when I bought my first big development site, no way, yeah, right off the credit crunch, and we bought this like a great downtown corner site when the old market was scared, right, okay, and we got a piece of land, probably had like 22 bucks available per square foot, because we rezoned it, so knew we would get the rezoned. It took us about four years, but there was an old rundown commercial building that we eventually turned into like 144 rental units. Wow, okay. But it was the first rental building built in one of the one, first or second built in BC in over 30 years, because didn't work for rental for a long, long time, for various reasons. So long trend, right? Yeah. So, so Jordan was one of my tenants, he was starting GMC projects, and he was leasing space from us. So I had known Jordan for a long time. So rarely do you have two of the three of the four founders you had a reference check, and so I'm like, oh, this is really interesting. So, for a couple of years, I just got to know Paul, and saying, what are you doing? I've always wanted to try coaching, but my background is more this, and so they hired me as a coach, but I do have less clients, and a lot of our coaches, because my big focus over time will be on Highfire Capital, in which we can help advise our clients to, like, you know, how do you raise money for a limited partnership, or totally, if it's good enough, like, we would like a shot at being part of the development or something, so totally framework, how we look at different different markets, how we like, because the real value is this insane group of clients that you've kind of most vetted in a way, yeah, be if the location timing are correct in that specific market, yeah, amazing spearhead, general partner developer for a project, and that's that's whole so hard to find, like people understand how hard that is to vet, because most of the time when I was in private equity, people call me up, and 99 times I'm like, I would never give that guy, like totally knocking on your door, yeah, and none of them would ever try to get coaching filter, none of those guys would ever, if you're at all a narcissist, you're not really into self improvement, so totally I've been blown away by just how good our clients are, and it's just a question of, obviously, the, you know, I've only been here about nine months, and it's, and I'm just getting my feet under me, and you know, you've got all this sort of turmoil, but I like turmoil, that usually means there's something's cooking. Hmm, so I'm just cooking. If you can, if you make your money in the buy, so if you can find the markets where it makes sense to buy, you usually win. It's when you try to force a deal. Yeah, that's all part of what we want, or you know. So the more I'm taking away, Brad, it kind of seems like you're, you know, the old guy, you know, the 7080 year old soul that's now going for those 20 years, and I've literally like the contrary, the cheerful contrarian, you know, cheerful. I keep coming up. It was really hard to the public sector when people, like, we're gonna spend half a billion dollars on this transit center, and I'm like, it's a garage, like, I, it's, I don't think you have that money anymore, like, it's like, it, you see the end coming, you see the trends coming, and so I think the key is really simplifying, and I know you guys use AI really well, like Adaptive does that better than most. One thing for me, which has been really interesting, just playing around with things like Claude and all that sort of stuff, is I can run really complex urban land economic models, like you could, you could dust off a book like this, like, like urban real estate economics, three or 400 and I can, like, do okay, do this, and do this, and I can create this really complex model. Yeah, I never would have the time before, because it took me a year or two to go and get that data from the census and stuff, so sure you do that in half an hour. What's interesting is I'll start with demographics and population growth, and it's uncanny how close I get to reality when I work with some of our.. if I have a guy in Utah, pick the top two spots in Utah, and he does, and I run it through a simple model, it throws those two cities, small towns at me. So, that's the more complex I get, the farther away from truth I get. Okay, wait, wait, so explain that. That's the key. It's like, what, how simple, like it's simplifying how you look at real estate, right? Okay, and that's that's what I want us to do, is like we want to be studies of demographic philosophers and streetwise economists of population. Why are people moving to an area, and why are people staying in an area and aging into real estate consumption consumption? Yeah, that was.. I'm glad you brought that up again, because that was one thing I wanted to dig into. It sounds so simple, right? So simple, it's like follow the growth all the time. Yeah, yeah, exactly. And then you're like, okay, well, if it's that easy, then, like, who can be a developer? I, you mentioned Utah, Denver's an interesting market. Have you ever looked much into Dorado, Denver? Like, yeah, dude, Rado, yeah, I mean, it didn't rate high for me right now, right? Yeah, but I mean, are interesting, yeah, right, like, there's, there's other areas of Denver. It would be one I'd be watching right now to see, like, like, what are the foreclosures, and, and what's the buildable cost per square foot. I would be more interested in, like, why are people moving to that area? Yeah, and the guys I think get it the best right would be to I've met Ryan and Drew, a blue truck group, they've keyed into, I think, in a sub market that is really, really key. I don't know how much I could share, but I mean, yeah, yeah, but I mean, what I would be looking for in the areas is what who's moving? I think Denver went through a period. I could be wrong, I've only looked at it briefly, right? Yeah, but I, I looked at Denver, I said, okay, well, how many people move there during Covid? And then is there a bit of a, like, is there going to be a period of time where you might, in some parts of Denver, see a decrease, they stop moving there. Yeah, right. Or just like a static period, and then also did the over build in certain areas, but then where, what, who is moving there? So, if millennials are going there and they're looking for single family homes, this what's fascinating to me about it is, is people are more than willing to drive an hour if they can buy a home at 30 acres, yeah, versus like say Victoria, here our burden on driving is very low, so if you drive 10 minutes out of downtown and you try to build a condo development, you're gonna lose money if you think you're gonna get the same price rent per square foot or sellable per square foot is downtown, and it's only a 10 minute drive that if Toronto would not make an impact. So you have to understand when you're looking at a certain market, is what's the value that area that people put on their time for driving commuting, that's different, interesting, and that's, and that's where understanding the demographics and the culture of the area, and that's why you need a local, because my model will tell me one thing, and then they're like, yeah, but you didn't think of that, so, and that's where, like, the contractors are poised so well to add in development, because they are, they're like one of the businesses that they're more or less handcuffed into their market, right, yeah, it was. Doesn't do, because it's a blue state, and there's more regulatory burden on average in blue states. I think they're blue state, aren't they? Like, yeah, so like purple, easy to build purple. I love that. Yeah, it should be easy to build in there, given the space you have, but there are regulatory issues that that make the supply curve inelastic, right? So, won't respond to demand as quickly as maybe like a red state, or I'll use Alberta, Edmonton. It just, it just responds so quickly that that homes tend to be cheaper over time, because supply keeps up with demand. So, so that's an area, if the burden of entry is high, given regulatory reasons, then sometimes if you time it right, then you get in on a great piece of land, and Victoria would probably be where I'm from, we be a lot like developing in California or Portland, or it'd be excessively anti-development, so if you can bridge that through your local contacts and whatnot, then then you can do very well if you get the best piece of land at the right time, and interesting. Yeah, okay. Now, no, no, this is good. I think one question that's coming up is, is like, I don't necessarily see a correlation between, I mean, we talked a little about, like, who you guys work with, like you've got your guys that are, you know, early in their, in their journeys, one to 2 million, call it in top line. You got your guys that are doing, you know, over 50 million, 100 million. You guys have a couple over 100 million clients. Yeah, mistaken, I think so. And I think, like, I don't necessarily see a consistency or a correlation between the size of the top line revenue and the success of the business, or the health of the business, and what I mean by that is, is like you could have a $50 million a year guy that still struggles to track costs, and like really know where they're at, and like then feeling comfortable and confident to go down that development path, right? They might be like, just lack of better terms, like they brag about their top line revenue, right. It's like you go to a country club and all the business owners love talking about their top line revenue, right. But then it's like, so what do you, what do you think is like absolutely fundamental, absolutely critical for a contractor, whether it's residential, commercial, whatever it might be, to position themselves to take advantage of developing opportunities? Like, what would you see that journey and that path being. Yeah, I think you nailed it. Where it's if people are always just talking about their top line, that could be a red alert, especially real estate develops the same way. If there's a guy who's always at the golf country club and bragging about this or that, and his deals just don't make sense. Yeah, how's that working well? They inevitably go bankrupt, or they bankrupt a bunch of people, and they move towns, right? Yeah, so construction guys, I think, I think sometimes they just, they fall in love with the work, and and then they're like, yeah, work at all costs, like top line, top line, top line, but I, if I'm looking, I'm always looking for who runs the tightest ship, and if a guy runs$2 million in sales, but has huge margins, a really tight business model, and has created a lot of time for him, like he can scale it, he can step away, go on vacation, he's not, he's not like getting up at four in the morning and going to bed at, you know, midnight, like, yeah, that to me is someone I'm more likely to want to give money to develop something, because I know he has time to think, solve problems, and he's focused, and you're focusing on the 8020 rule, like, where they're, where's their time spent, and can they create a company that, that allows them to spend time on things that would actually make them the most money, like would move the dials, because the way I was taught is don't don't just get into development for the sake of development, understand the difference between something that has high margins, big return on cost, and there always are going to be problems every day, there's a problem to solve as a real estate developer, or or owning a construction company, but the better you build your strategy, so in construction companies it's your strategic plan and element, it's more, I would say, like an economic strategic plan, it's coming, but at the end of the day, it's a strategic plan, okay, like this is where I'm going. This, I'm going to get there. These steps I have to take, and then the number one issue I'd say for our, our, and sometimes it's our biggest guys, because they're so good, but they really, they really need to hire a COO. Yeah, and and it's so hard for them to do that, and every time they do that, and they get the right guy, it's like their whole life has changed, and you like, for the better, for the better, like they're younger, they're fitter, they're less stressed out, and they have time to think and work on the business. Who's the guy? Who does this best out of Kansas City? One of our clients, but I would say he's one of the biggest success stories. Like 80 hours a week, go, go, go. Was it Steven? Steven, yeah, Stephen. Yeah, I think he might have, like, I might have met Steven if he named the name of the company. We could find it in a second. I, anyways, like I would say, he, he is, he is like a good class example where Paul was his coach, he had one of the best coaches, I think Paul Osted, and our CEO is probably the best coach I've ever met, yeah, for this area, and Stephen, his client, one of the highest parts clients, was was working so much in the business, just just never seen his kids, not having dinner with his family. Yeah, and so he built, he focused on scaling his company. It's like, who, who do I have to hire? And it was really hard to believe that hiring this person wouldn't be at a huge cost, but at the end of the day, it freed up his time to work on things that would make him more money, for him that was real estate investment. So, buying commercial properties and building wealth through real estate, so not only is he incredibly more wealthy now, as long as he doesn't overextend, he will be incredibly way more wealthy in 10 years, and he has way more time, yeah, with his kids every evening. So, I think, yeah, that in a nutshell is what you want to achieve, whether you make 2 million top revenue or 50 is irrelevant to me. It's, it's like, how do you want to design your life, and what do you want your week to look like? And that's what I want to dig on, because, like, that is someone would listen to that last, you know, couple minutes, and would be like that's what I want, like I'd be hard. There's not many people out there that say they don't want the making. You guys are like, I just love to work 80 hours a week, and I don't want kids, and I don't want a dog. They probably need therapy more than coaching, right? Yeah, right, that too. Yeah. So, so, but it's like, what is like, and I obviously know, like, you guys offer the service, but what would you say are like some of the more tactical things, regardless of top line revenue, that these contractors can do? And I mean, you mentioned the 8020 rule, like, I know the 8020 rule, as in 80% of the work gets done by 20% of the people, yeah, but like, what do you like? Give me some, like, give me some more depth on that, a little bit more, like, if you're talking to someone, what would you poise them to do? Yeah, like I think, like you know, context is king, of course. We could run a scenario, universal rules are for fools, but there are some universal rules that, on average, do the best thing, right? So I always say, like, I like to look at someone's org chart, first and foremost, like there are the things we do first, and we look at their financials, and we get a sense where they're at, but I always get a sense, like, do you have really punchy job descriptions with this is your job description, this is your job deliverable for the person, and this is your KPI, that's like the success metric, might be your gross revenue, it might be like, how for a product manager, how is their gross profit per week actuals versus what you budgeted, things like that. So, there are things you can, you can track. I think when you, when you like, adaptive is a great tool, because it, it allows them to understand their financials sooner, faster, and easier, right? Yeah, yep. So you start to see where you're trending, and then if you're for the, you know, the most important KPIs and job levels are the CEO. So we want him focusing on the big things, yep, and we want him to have a dashboard that is up to date as quickly as possible. Totally knows that certain jobs are losing money if the gross profit per week is going down, then he can ask questions and say, well, why, why are we trending this way, what's going on. Yes, also a real simple meeting situation where you have every week certain guys come to you of management summary reports, and they're just 20 minutes long, and they prep for the report, and they just go over KPIs, boom, boom, boom, boom, right. Yep. And then, so we're trying to, so things like that. The most main thing, though, is too, is like put a value on your time, and then see where you're spending your time, and then reverse engineer it. Would you pay yourself that much? Would you pay, hire someone and pay them what you're paying yourself to do that job? Yes, yeah, and then we can sort of see, like, like how much, how much money that, if you know, if you're, if you're kind of spending over 100k a year on doing certain and certain activity where you could hire someone for half that, well, then that's that's a signal to hire sure your systems, yes, but yeah, but I always remember the first time I met, I met you, and I saw Adaptive, and then I talked to a lot of our clients who came to us through you, and just how much time you guys saved them, I was ever. Thing like, and that's that's the exciting moment we are in, in this area of industry, because we, we, you know, AI is not going to take your ability to lift a hammer or do things or interact core part of your business, but it sure will allow you to understand your business faster, in my opinion. What's up, everybody? Quick interruption before we get back into it. If you're a contractor who wants to walk away with an extra $20,000 in your pocket for one hour of your time, listen up. On June 30, we are partnering with Paul Atherton and the team at Hicepire for a live webinar, and we're calling it exactly what it is, how to increase net profit. This is no fluff, no sales pitch disguised as a webinar. Paul is going to hand you the actual levers overhead you're hemorrhaging right now without knowing it. How gross profit per week tracking can move you from 10% to 15% net margin, and how to stop letting schedule creep quietly, kill your projects. Contractors who have implemented this stuff have saved upwards of$300,000 on their bottom line. One guy knocked 46k office overhead in a single week. So, register now. The link's gonna be in the show notes, june 30, 9am Pacific time. Don't miss it. We're like in this conversation now, to where it's like, it's sure hiring people, like you need to hire people, but now we're like in the age of like AI and agentic AI, actually performing tasks at like a high enough quality to where it's not just can I hire somebody, but should I go down the solution path, right? But the one piece I wanted to touch on, just to bring this back, because I was literally just with, I was with a contractor built and ran over$100 million company, and he's like a business builder to his core, right, and he's the guy that's like wants to be in the weeds, and more, he's forgotten more than most people will ever learn, type of guy, but like I think about that, of like, how do you start to get someone like that to see I need to hire this person to remove myself from this part of the game? Like, is it really just like a wake-up in the morning type of thing and sit down and evaluate your day? Is it an exercise where you look at your calendar? Is it I write down what I do every minute, or like, if I'm on the task for 30 minutes and I say I spent this much time doing, like, how do you get to that point? Yeah, how I get.. I mean, there are best rules to do it, like a best way to do it is you track your time, yeah, the hour, and say, like, where did you spend your time? I find that for some of our clients it's very hard to get them to track their time, so I'm like, great, give me an estimate, like, walk me through it. Use, show me your calendar. Where do you block time? Like, yeah, definitely want to use a calendar to block time, block spare time. I like to get people to front load their week sooner is better than later. Later, for me, you know, better well than later. And you lose a day, lose a week, is a month, to lose a year. Yeah, but the main, the main way to get someone to run their business better, I find, is there's a why attached, a real why, why they need to create more time, they're running on desire, determination, drive, and they burn out, right? Yeah, or they go through a divorce, yeah, they have a health issue, right, like I had health issue, and so I stepped away from real estate development for a while. Like, you know, you're in, you're in China, going to 20 different cities in three weeks, and you're looking like it's just.. wait, is that what you did? Yeah, that's one, because you're always problem solving, you know, like, like, save 5 million bucks. Okay, I guess Brad's gonna figure out how to.. we're gonna, we're gonna see what it, what you have to do to import stuff, right? So, or like one of my partners at one point were late on where the window company we were using out of Thailand, I think it was for one project, was was late, and so Steve Cox, I think he's in 70s, went to Thailand because I couldn't, I was having a baby, the son Dan couldn't. So Steve goes, Steve had a like had to have heart surgery while he was there entire, yeah, minor heart surgery, but still heart surgery, yeah, heart surgery, yeah. Then two days later he's back in the factory, just kind of standing there like this old developer guy, who just stink guy, and so, like, like, sometimes that's what it takes to not go bankrupt, like, you know, COVID hit, wild friends, but, but at the end of the day, like, we want to, we want to plan around that, and, and if we had coaching, I'm sure we could have prevented some of that. I mean, developments like on a project that big the way we did it, sometimes, sometimes life happens. Yeah, what I want to do is, I want to make your business as efficient as possible, so you have time when life happens, when it hits you in the face, you have energy. Me and the ability to deal with it. Yeah, okay, yeah. So, going, going to China or Thailand, to me, is definitely a CEO activity. You need that in the game. You need to be on the disclosure statement or the general partner, but doing like running your sales processes or picking up a hammer or doing your bookkeeping, that is something you can hire for at some point. The key is like, how do we get people doing certain tasks, so you have time. Sometimes it's just thinking time, like what's that book, The Road Less Stupid. Okay, like a Ron White story, something like that. Like, it's the narrator's great, he sounds like a very grumpy old man, yeah, and he's like, "No, go after every chapter, go and think, you'll thank me for it, and it's like he just says, "Great thinking, and that resonated with me, because that's what I was always told, you just need to go think, yeah, and your best ideas, like the best big ideas, come when you have time to think. Yes, like owners need time to read some of these books. Yeah, about them. I've been reading this book 20 years, and I still hardly understand it. Like, what is that? Secrets of the Temple, how the Federal Reserve runs the country, and you kind of like, or it's one of the best ways to understand, and it's imperfect to a certain degree, but you're trying to understand cycles like, like how, how credit, you know, the Fed can impact the cycle of credit availability, right? So, yeah, you can service your debt, but if you get the timing wrong at some point, and this is a, this is a big trend, like we saw it in the 80s, right, where they're like inflation in our check, yeah, and then all of a sudden your debt matures, and no one else will refinance you, yeah, yeah, sure. Just rates go to.. so I mean, I'm saying that's going to happen, but I'm just saying, like, understanding why it happened is an insight that I think every real estate developer should have time to meditate on. Totally, and you can't get that time if you don't have the business in place that can run itself. Yeah, you don't hire someone to go and meditate on that kind of stuff, like there's people, there's things you hire people for, and then there's things that I believe only an owner should be doing to a certain extent if he's, if he's in an owner of real estate development. So, totally, yeah, and then from there, like in order to get to the business that is like self-sustaining or running healthier. You need the strong why. Do I want more time to meditate, so that I can grow this thing? Or do you want to be stressed out all the time and working till one in the morning on your books, you know? And yeah, or do you want a really poor sales and marketing funnel? Yeah, and not understand how you can build up your pipeline, yeah, and you also like, you need a real strong marketing and sales and operation. They all have to integrate, right? You need, you need to be able to capture market wind, and you need to, you know, have a strong operational side where you can build efficiently, right? And you need to go back and forth and sort of put your, your finger on each pulse, but you also need to have time to see when it might change, so like marketing is interesting, where people used to Google, and now we're seeing a lot of people are using their AI to find how do you win GPT, yeah, yeah, so that's that, that's going to be a pivot on how you change your marketing strategy, and you need time to be there first. Yeah, I mean, because if you're so lost in the business, you might be a year behind that moment, and that, that doesn't happen all the time, but like the world's like that, it gives you moments, right. Of course, you have to have time to see it coming, you know. Of course, yeah. So, what a.. that's what a well-run business gives you. It allows guys to work on the business, to strategize, to think. That's what strategy is. A good shot. What do you think is the number one thing that keeps business owners from doing that. I know we talked about the why it's their brain. It's, it's, it's.. I would say a lot of entrepreneurs have some form of tension deficit. I do. Yeah, a great book is called Scattered Minds. Like, it's up there somewhere. Is that the one with the leaf was that, is that the one with the leaf behind you? Is that a leaf top, middle? Oh, yeah, this is it. Yeah, yeah. So, scattered minds by Ariel, yeah, Gaber mate, yeah. And so my wife got this for me was in the last year, and for years we've been having this argument that I don't have attention deficit, because I'd be like, I can hyper focus, I can get shit done. No, you're good, you're done. Edit, yeah. And I've done all these things, so I don't get it. Yeah, you know. And and then I opened up the first chapter, and the guy wrote it like he was, he's a surgeon, okay. Yeah, he describes himself in university. I'm like, okay, I have attention deficit, so it's all about, like, you know, like one way I describe a lot of our clients, you know, if we're all Vikings, they're people I wanted to vote with me. Yeah, yeah, totally, they're self-sufficient, they solve problems. My dad was expert-ish, father, and so I would send the behind enemy lines, and they would just mess stuff up, and yeah, think on their feet, you know. And so I find construction company owners the special forces of business. Yeah, it's dynamic, there's variables, they can think on their feet, they're warriors, and I think their brains just are they're great at contextualizing things naturally, and they, they love the when you have a scattered mind, you like dopamine hits, yeah, you're looking for that, boom, boom, boom. So, what, what you tend to like is like when you're growing your business and you're starting it, you're involved in everything, it's dynamic here, boom, boom, energy, desire, drive, determination, boom, boom, boom, but eventually you burn out, because it gets so and so, so, so big, right, and so you know, and even if it's not getting that big, it gets big enough, like, you know, you have three employees, and you're, you have enough clients, and you're like, okay, I'm missing things because we don't have the system, and I can't do it, and so are you, you might be hardwired up here just to lean in and work harder, because that gives you joy, you feel like you've worked hard, sure, and it's very hard to get that dopamine hit to sit and think, yeah, and we tend to procrastinate that type of work, we tend to want our brains procrastinate, so if you, some of our clients, a few, I would say, are not like this, they are very analytical, they may not have an engineering background, they are linear thinkers, like, and they are very good at putting in systems and processes and stuff, right? Their weakness might be they don't use the right hemisphere of the brain naturally, and they don't contextualize enough, so they get, they get kind of lost in the details a little bit, because that's, that's their dopamine hit. So I'm only going in on trying to make assumptions on how someone's brain might naturally work, and where do they get that rush? Right, sure, that joy, and but then also, where do they get frustrated. Where do they get flooded? Where they get overwhelmed? Where do they forget things? Yeah, where are you making hot decisions, hot takes? Yeah, where are you overpowering people, and they're trying to give you advice. Yeah, yeah, these are.. and that's the stuff that you coach them on. Yeah, yeah. I'm just.. I mean, that's that's how I approach it. I, I approach, I coached very honestly the way I was coached. Yeah, one of my coaches was a developer, but an Ayurvedic doctor, like you. He would take your pulse, he would describe what type of personality you'd have. It was quite interesting. Yeah, sure. You know, I studied in India. Yeah, and he would tell me I'm prone to this, this, and this, and they just met me, and I'm like, okay, kind of, they're a crystal ball, but yeah, but then he would give me hard truths and say, well, Brad, you, you could do this, this, and this, or I would be like, yeah, these guys just bullied me out of a big deal, and I'm, you know, those guys are jerks, and and he's like, well, what did you do or not do, and then he would just lay it out for me. I'm like, okay, like, like, so soon as you're willing to listen to hard truths, you're ready to be coached. Now, saying that, like, coaches aren't always going to get it right, so it's a, it's a sort of a mutual self-discovery process, right? Sure, but but you have that discovery process, and then you then then people admit that this is what they have to do, and then the hard part is, did you do it, did you exactly, and the cool thing about things like adaptive, or like, you know, like Claude is another tool, where it's like I said, there's no reason why you can't go and do this now. Yeah, like,

here's the trade off: 44:01

you spend this much money, it saves you this much time, and you can go do it. Yes, right. Adaptive will do this, this, and this, and this. You don't have to hire this person, and now you're paying this much time. Or even a simple thing is like, hey, build me an org chart and attach job descriptions to them, KPIs. Well, what's this? I'm like, we can do it in half an hour, a rough draft, and it can be, you can create interactive dashboards, so, so, what I want people to do is not go, not get distracted and go down this massive distraction phase of using new tools, but saying, okay, this, what it does for me, this high track success, and then on to the next one, and, and now, so totally, that's actually, yeah, so that's really sound advice. Yeah, I was, I was just talking about this with another contractor, and he spelled it out exactly like that. There's so many tools, there's so many new things - software, technology, service is all changing so fast. Where do you start? And I just told him, I was like, you just need to set back in your day, and I. Identify the areas that you're spending the most time and start your search on the software service solution, whatever, that's going to get rid of that roadblock, and like, that's, I mean, we have this conversation all the time with Adaptive, right? We're financial ops, right, we don't have product management, and there's all these tools out there, and, like, well, we want it all in one, we want the project management side, and it's like, okay, well, are you.. do you have an operations problem or do you have a money tracking problem, right? And you could have both, but then prioritize them, and it's like, what are you actually trying to solve, and where are you trying to go after that? And it's like, with these contractors that are doing 5 million bucks in top line, and they're like, we want to scale, and it's like, well, yeah, but you don't know your numbers. It was like, do you think Apple went out and was building a billion iPhones a year before they knew they would make money on them, or did they find out how they were going to make money on them, and then start building? Right, so it's like those similar concepts of like having that self-reflection. Yeah, I think, yeah, you got to ask someone, do they want to be an owner operator or a strategic owner? Yeah, I think I think they have to like make that decision, and, and then you got to think, like, what is the, what is the way we're going to get there? Yeah, and then what do we have to track, and what matters most, right? Yeah, and, and, yeah, I mean, it sounds so easy, but it just takes, it just takes a bit of coaching, I think, at least for a period of time, and then you need strong metrics on did this coaching create time for me, and then what am I doing with that time, or am I constantly getting pulled back into the dopamine hit? Totally, totally, Brad, this was this was a killer episode, dude. What I said, I had a few questions for you. Yeah, let's hear it. Rep it like I'm a big fan adaptive, but I always like I want to improve my ability to talk about it, and what I like about it is I'm not a linear thinker. I hate, like, this is just how I use this for this, and project management, and I have financials. I love how you guys are integrating that story. Yep, so, so what are some key, like key things like I can pass on to my clients who aren't, haven't discovered you guys yet? So, because I have a lot of clients who use you, but obviously you're not in everywhere in Canada, that yeah, we'll start clients in the US, and yeah, but like, talk to me about that, bridging the financial analysis from the project management, just, yeah, so I'll, I'll right now, like, historically adaptive was a financial ops platform for construction accounting, okay, so that was your AP expense tracking, your cost tracking, your income, tracking your accounts receivable, and then your budgeting, web reporting, and all the ancillary stuff that goes around that with vendor compliance, payments, lien waivers, stuff like that. Now, because we have that platform, we are building agents specifically for construction accounting workflows. Okay, so we have an AP expense agent, we have a billing agent, we have a WIP agent, we have a field context agent, right. And essentially, what those agents are doing is we'll have clients that come in and they'll say, or prospects rather, and they'll say, 'Hey, we hear all this stuff about AI, but we want to get a partner in to actually help us embed this in a meaningful way to our back office tasks. Okay, so what we'll do now is, is we'll go through a scoping process to understand what their data looks like, first and foremost, because that's a big part of agents, right, and the success of those agents. But then we can build these custom agents to start performing those tasks. So, think of it this way, because we're already ingesting all of their cost, because we're ingesting all their income, because we're connected to their inbox, because you know context is getting funneled into the product now we can build an agent that on a weekly basis will automatically call all the project managers and ask them a set list of questions that somebody would already be wanting on a weekly basis, call it the project manager answers those questions over the phone. It's transcribed, it's in adaptive, and then that agent takes that context and starts performing actions. Okay, an example like a WIP analyst, right? You can have a weekly WIP analyst agent running an adaptive, and it's going to be gathering all this context. It's like, hey, we see that this project is under billed by $1.2 million We saw you were going back and forth with this client on $800,000 change order, but it looks like we haven't, you know, x, y, and z with the remaining x number. What do you want us to do with this? I'm like, oh great point, I need to get that change order built. I haven't yet, but we have specs from this project that'll be about the same. If you get the rough draft built, I'll come in and tweak it and send it. Oh, and by the way, we had a delay on this, so we're actually going to hold payment on that 200,000 And then the agent is updating payment dates, it's going through and it's building change orders, and it's getting invoicing put together with all the costs. So then it's just ascend once the user approves it. I would love to, like, over time, like if you guys. I one day would see trends in account receivables like extending, and that would be a leading indicator in a market slowing down, and you could literally, you could join it's just my mind just watch what you guys do, and that's where, like, with our AI assistant, right, it's like we've got the agents and then we've got the brain, right, so it's like we've got all this data, so you could literally bop into one if you wanted to see Brad, you could bop into one of your clients' adaptive accounts, go to the AI assistant, and just like a GPT, be like, I want you to take the trailing 36 months of billings on these types of projects and tell me what's going to happen in the future, and it'll like pull all that data and it'll push out a response, you'd obviously want to validate it, right, but you could start running, because we have all that information, all that data, that's where we can start running agents, we can run large language models, right, we can do all those different things, right. So, all right, man, this was so cool. Thank you. Yeah, hope it was fun. I know we kind of jumped around a lot today, but it's always a good conversation with Brad Stokes, yeah, I, it's you're the bromance I've been waiting my whole life for to make it weird. Hey, no, you're Canadian, it's okay, it's okay, yeah, you're a hugger, you're a hugger, hugger, man, it's like when you have the context, it's not a weird comment, exactly, you know, so good luck. I know what you're up to. We're heading to our June conference. What are you, what are you doing? What's coming up for you guys? We've got, so we're actually kind of quiet when it comes to like conferences, trade shows up until like August. We're really involved with CFMA, which is the Construction Financial Management Association, and we're going to be hitting a ton of their regional conferences, so we're, we're kind of gearing up for that, but yeah, I mean, I'm always on the fly, I'm always, I'm always, you know, up for something, so we'll get together at some point, but yeah, like I said, it's always great having you on, Brad, we'll, we'll be in touch, dude. Yeah, thank you so much. Appreciate you. Take care. Bye. See ya.